Colombia’s Mining and Energy Planning Unit (UPME) has opened for consultation a draft resolution defining the procedure to allocate transmission capacity to power generation projects with firm energy obligations or completed environmental permits.
The proposal implements Resolution CREG 101 094 of 2025 and establishes formal application windows, strict deadlines and a 10-year electrical system assessment horizon.
The new framework directly affects projects awarded under Colombia’s Reliability Charge auctions (Cargo por Confiabilidad), particularly for 2029–2030, when projected demand growth and uncertainty around commercial operation dates (FPO – Fecha de Puesta en Operación) require tighter coordination between generation and grid expansion.
According to Hemberth Suárez Lozano, lawyer at OGE ENERGY, the procedure aims to address “inefficiency and delays in the allocation of transmission capacity for power generation projects”.
He added that the draft seeks to “provide clarity and certainty regarding the technical criteria applied in the evaluation process, ensuring assessments are transparent rather than discretionary”.
A central question is whether the new model guarantees that projects awarded in reliability auctions will connect on time and meet their firm energy obligations. Suárez Lozano believes it improves the likelihood.
The framework establishes defined application windows, procedural deadlines and clear evaluation criteria, prioritising projects with acquired obligations under the Reliability Charge scheme — Colombia’s capacity remuneration mechanism designed to ensure long-term system adequacy.
However, capacity allocation remains conditional.
“The award is subject to technical feasibility and to the execution of works required to eliminate network constraints,” Suárez Lozano warned.
The draft introduces an iterative process including:
-
Review of baseline and supplementary information
-
Issuance of technical observations
-
Final approval or rejection of the grid connection concept
The maximum timeframe is five months from formal submission.
Grid connection approval will only be granted if the proposed works effectively remove identified constraints and do not create new bottlenecks within the National Interconnected System (SIN).
In addition, the project’s commercial operation date (FPO) will be conditional upon the entry into operation of the associated transmission infrastructure. The connection substation must be operational at least three months before the generation plant.
The regulation explicitly recognises the possibility of denying transmission capacity. Such denial would occur if the technical evaluation concludes that the proposed works fail to remove constraints or introduce new system limitations.
While Suárez Lozano considers the probability of rejection to be low, the risk remains embedded in the regulatory design.
From a financing perspective, the new framework introduces greater regulatory clarity — a key factor for investment in renewables and thermal generation alike.
“The existence of clear procedures and criteria may provide greater certainty to lenders regarding the steps and requirements to obtain transmission capacity, which is positive for financial close,” Suárez Lozano noted.
For structuring banks and infrastructure funds, the definition of concrete milestones reduces regulatory risk. However, technical risk linked to transmission expansion works remains.
This is particularly relevant for renewable energy projects — including solar PV and wind power — that depend on timely grid integration to secure revenues under long-term power purchase agreements (PPAs) or firm energy obligations.
The draft emerges amid warnings from UPME about increasing demand pressure in 2029 and 2030. In that context, coordination between generation auctions and actual grid capacity becomes strategically critical.
Suárez Lozano argued that “greater coordination” between auction schedules and real transmission availability would be advisable.
Closer alignment would:
-
Reduce the risk of awarding obligations to projects unable to connect on time
-
Optimise planning of transmission expansion and reinforcement works
-
Mitigate systemic non-compliance risks in critical years (2029–2030)
The signal is clear: generation expansion — whether thermal, hydro, solar PV or wind power — must progress in parallel with transmission and distribution upgrades to safeguard energy security.
The draft also introduces:
-
Individual validation of grid constraints
-
System-wide joint analysis of technically viable projects
-
The possibility of grouping works when projects share common bottlenecks
Through these mechanisms, the regulator aims to enhance technical transparency and limit discretionary decision-making in transmission capacity allocation.
In summary, the new procedure does not eliminate grid connection risk but organises it under explicit and time-bound rules. It prioritises projects with firm obligations, establishes defined procedural milestones and conditions transmission access on verifiable technical solutions.
As Colombia moves towards the second half of the decade, the debate is shifting. The key question is no longer how much generation capacity is awarded, but how much of that capacity can be effectively connected to the grid in time, without compromising system reliability or security of supply.
